Due to the municipality’s existing debts, everyday street maintenance in Rezekne may be at risk, according to the report from interim head of the municipal government Guna Puce presented to the Saeima Public Administration and Local Government Committee on the 5th of November.
She admitted that when the interim administration began to work in the city, the financial situation there was critical and the state loan of four million did not save the situation. The financial situation is still wave-like because “the commitment table was incomplete”.
The municipality still owes “Arčers” LLC for the construction of the recreation centre. The overall debt amount reaches approximately half a million euros, said Puce. “Constructive negotiations” are underway with the company to divide the debt into payments and continue payments next year.
Puce admitted that a dangerous situation has formed with the implementation of the basic functions of the municipality, due to the accumulation of contractual penalties for the daily maintenance of the streets. The problem “bloomed” in full just recently, and an investigation has commenced into this situation. According to the head of the interim administration, other municipal administrations were ordered to come up with budget amendments. Procurement and projects are under review to help find resources to divert towards fines.
“Generally, the practice until now was putting off problem solving to a later date,” Puce described the approach used by the now dissolved administration.
A member of the interim administration, Iveta Mietule, said that, when working on the next year’s budget, not all offices of the municipal administration are prepared to accept the situation, so there are still some sectors in which it is necessary to review expenses.
Mietule added that next year’s PIT revenue forecast is expected to be about one mission euros higher, but this is not much when compared to the total volume of expenses.
“Neither the residents nor the workers of the municipal administration have any idea just how serious the situation has become,” said a member of the interim administration Jānis Belkovskis.